diff --git a/packages/ui/src/components/sections/shared/SettingsProjectSelector.tsx b/packages/ui/src/components/sections/shared/SettingsProjectSelector.tsx
index 709d5c50..9acbd7b0 100644
--- a/packages/ui/src/components/sections/shared/SettingsProjectSelector.tsx
+++ b/packages/ui/src/components/sections/shared/SettingsProjectSelector.tsx
@@ -12,9 +12,7 @@ import { isVSCodeRuntime } from '@/lib/desktop';
 import { cn } from '@/lib/utils';
 import { useI18n } from '@/lib/i18n';
 
-const formatProjectLabel = (label: string): string => {
-  return label.replace(/[-_]/g, ' ').replace(/\b\w/g, (char) => char.toUpperCase());
-};
+const formatProjectLabel = (label: string): string => label.trim();
 
 export const SettingsProjectSelector: React.FC<{ className?: string }> = ({ className }) => {
   const { t } = useI18n();
diff --git a/packages/ui/src/components/session/sidebar/utils.tsx b/packages/ui/src/components/session/sidebar/utils.tsx
index 05e57157..3d10eb4c 100644
--- a/packages/ui/src/components/session/sidebar/utils.tsx
+++ b/packages/ui/src/components/session/sidebar/utils.tsx
@@ -156,11 +156,8 @@ export const resolveArchivedFolderName = (session: Session, projectRoot: string
   return segments[segments.length - 1] ?? 'unassigned';
 };
 
-export const formatProjectLabel = (label: string): string => {
-  return label
-    .replace(/[-_]/g, ' ')
-    .replace(/\b\w/g, (char) => char.toUpperCase());
-};
+// Folder names are shown exactly as they are on disk — no title-casing.
+export const formatProjectLabel = (label: string): string => label.trim();
 
 export const renderHighlightedText = (text: string, query: string): React.ReactNode => {
   if (!query) {
diff --git a/packages/ui/src/hooks/useWindowTitle.ts b/packages/ui/src/hooks/useWindowTitle.ts
index 87e64019..7fb31e4c 100644
--- a/packages/ui/src/hooks/useWindowTitle.ts
+++ b/packages/ui/src/hooks/useWindowTitle.ts
@@ -7,9 +7,7 @@ import { getRuntimeApiBaseUrl } from '@/lib/runtime-switch';
 
 const APP_TITLE = 'OpenChamber';
 
-const formatProjectLabel = (label: string): string => {
-  return label.replace(/[-_]/g, ' ').replace(/\b\w/g, (char) => char.toUpperCase());
-};
+const formatProjectLabel = (label: string): string => label.trim();
 
 const getProjectNameFromPath = (path: string): string => {
   const normalized = path.replace(/\\/g, '/').replace(/\/+$/, '');
diff --git a/packages/ui/src/stores/useProjectsStore.ts b/packages/ui/src/stores/useProjectsStore.ts
index fbf279b3..0f37f137 100644
--- a/packages/ui/src/stores/useProjectsStore.ts
+++ b/packages/ui/src/stores/useProjectsStore.ts
@@ -166,14 +166,22 @@ const normalizeProjectPath = (value: string): string => {
   return normalized.length > 1 ? normalized.replace(/\/+$/, '') : normalized;
 };
 
+// Folder names are shown verbatim: title-casing them turned `.ssh` into `.Ssh`
+// and made every project look like a name the user never chose.
 const deriveProjectLabel = (path: string): string => {
   const normalized = normalizeProjectPath(path);
   if (!normalized || normalized === '/') {
     return 'Root';
   }
   const segments = normalized.split('/').filter(Boolean);
-  const raw = segments[segments.length - 1] || normalized;
-  return raw.replace(/[-_]/g, ' ').replace(/\b\w/g, (c) => c.toUpperCase());
+  return segments[segments.length - 1] || normalized;
+};
+
+// Labels auto-derived by older versions were title-cased and persisted. Drop
+// them back to the folder name; labels the user typed themselves are kept.
+const legacyAutoProjectLabel = (path: string): string => {
+  const derived = deriveProjectLabel(path);
+  return derived.replace(/[-_]/g, ' ').replace(/\b\w/g, (c) => c.toUpperCase());
 };
 
 const sanitizeProjectIconImage = (value: unknown): ProjectEntry['iconImage'] | undefined => {
@@ -261,7 +269,10 @@ const sanitizeProjects = (value: unknown): ProjectEntry[] => {
     };
 
     if (typeof candidate.label === 'string' && candidate.label.trim().length > 0) {
-      project.label = candidate.label.trim();
+      const storedLabel = candidate.label.trim();
+      project.label = storedLabel === legacyAutoProjectLabel(normalizedPath)
+        ? deriveProjectLabel(normalizedPath)
+        : storedLabel;
     }
     if (typeof candidate.icon === 'string' && candidate.icon.trim().length > 0) {
       project.icon = candidate.icon.trim();
diff --git a/packages/web/server/lib/notifications/template-runtime.js b/packages/web/server/lib/notifications/template-runtime.js
index b7233c3e..7400e24b 100644
--- a/packages/web/server/lib/notifications/template-runtime.js
+++ b/packages/web/server/lib/notifications/template-runtime.js
@@ -27,9 +27,8 @@ export const createNotificationTemplateRuntime = (deps) => {
 
   const formatProjectLabel = (label) => {
     if (!label || typeof label !== 'string') return '';
-    return label
-      .replace(/[-_]/g, ' ')
-      .replace(/\b\w/g, (char) => char.toUpperCase());
+    // Folder names are shown exactly as they are on disk — no title-casing.
+    return label.trim();
   };
 
   const resolveNotificationTemplate = (template, variables) => {